Executive Committee of the American Institute of Physics
Minutes of Meeting
Members Present: R. A. Sawyer – Chairman, Joseph A. Burton, H. R. Crane, Ronald Geballe, W. W. Havens, Jr., H. William Koch, R. B. Lindsay, Mary E. Warga
AIP Staff Present: H. William Koch, Wallace Waterfall, G. F. Gilbert, Lewis Slack, Robert H. Marks, Mary M. Johnson
Chairman Sawyer called the meeting to order at 9:33 a.m.
1. Minutes
Upon motion made and passed without dissent, the minutes of the Executive Committee meeting of October 5, 1970, were approved as distributed.
2. Report of Executive Review Committee
Mr. Burton said that the Committee, composed of himself, Mr. Crane, and Mr. Fusfeld, had completed its work and he asked that the staff be excused while the Committee discussed its recommendations with the Executive Committee. All staff members present left and, on their return, were told that the following executive salary changes had been authorized: (Details given only on official copy of these minutes.)
The salary of G. F. Gilbert to be increased from $27,000 to $28,500 per year effective January 1, 1971.
The salary of R. H. Marks to be increased from $27,000 to $28,500 per year effective May 1, 1971.
3. 1971 Budget
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Review of 1970 Influences on 1971 Budget
The Director said he wished to comment briefly on two points – employment of physicists and publication activity – and that other members of the staff would speak specifically on various budget items. He suggested that general discussion of the budget and action on various items be deferred until the completion of the presentation.
The Director said that much of his time and also the time of other staff members during the latter part of 1970 had been spent on problems relating to the employment of physicists. AIP recognizes that the sudden shortage of jobs for physicists has presented many serious problems. The Institute has tried to show its concern and to develop and disseminate information which would help alleviate the situation.
On the subject of publication activity the Director said he felt the Institute had made much progress during 1970. Under Mr. Marks’ direction the Editorial Mechanics Section has been reorganized and changes have been made in procedures so that publishing delays have been greatly reduced. We are now assured that all 1970 issues of all journals will be in the mails before December 31. The biggest remaining problem is the variation in size between successive issues of some journals but it is hoped that this can be worked out with the respective editors during the next few months. Financial problems currently being faced by many educational institutions mean that we must expect continuing difficulty in the honoring of page charges. AIP will continue to follow this matter closely and take all possible steps to encourage page charge honoring.
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Special Newsletter on Manpower
(This item appeared in this position on the meeting agenda but it was deferred for discussion during the lunch period.) During lunch Mr. Slack described a special manpower newsletter which was being prepared at the request of APS and was intended for wide distribution to APS members and would be made available to members of other Societies if they wanted it. It was agreed that this was a matter between APS and AIP and should be settled outside of the current meeting.
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Major Considerations in Preparing 1971 Budget
The Director said that preparation of the 1971 budget had required many staff decisions and assumptions, particularly in connection with our publishing operations. He asked Mr. Marks to explain these and other staff members to explain considerations involved in other than publishing activities.
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Publishing Operations
Mr. Marks explained the assumptions with respect to publishing operations as follows:
At the July meeting the Executive Committee authorized substantial increases in the non-member subscription prices of AIP journals. Based on past experience, it has been assumed that the number of non-member subscriptions will remain approximately the same in spite of these price increases.
Income from advertising dropped substantially in 1970 and we expect a further drop of two or three per cent in 1971. This particularly affects PHYSICS TODAY and that journal is budgeted to show a net expense of approximately $32,000 in 1971. We have hopes of doing better than that by reducing costs on composition and printing and, possibly by increasing our sales of advertising space on the West Coast. We have recently worked out a commission arrangement with a West Coast selling organization who will promote PT and RSI advertising out there.
Providing 100 free reprints to authors who honor page charges has been costing us approximately $75,000 per year. About two years ago the American Chemical Society discontinued free reprints and they claim it has not affected honoring. We propose to do likewise and have based the 1971 budget on that assumption.
We believe our prices on reprints could be raised without serious objection and propose prices as listed on the attached schedule (Exhibit A).
The 1971 budget assumes that about one-third of the authors who would have received free reprints on the payment of publication charges will now order and pay for the reprints at the new reprint prices.
1971 page budgets for both honored and unhonored pages have been established for each of the journals based on recent past performance of each journal. It is planned to publish during the year no more than the budgeted number of unhonored pages and to distribute these unhonored pages as uniformly as possible in the issues throughout the year. This may mean that some journals may develop a substantial backlog of unpublished, unhonored pages and we plan to make no commitment as to when the papers in this backlog will be published.
In-house typewriter composition is planned for JAP beginning with the July issue. During April, May, and June we will actually be paying for the costs of this typewriter composition but we propose to defer these costs and charge them to the appropriate issues after they are published. This will be consistent with past policy in which we have been charged for composition by the printer after the issue is published.
Offset printing is now competitive with or slightly less costly than letterpress printing. Letterpress printing requires engravings which are costly compared to making photographic prints of the art work which are pasted on the mechanicals to make camera-ready copy for offset printing. This method can be used whether the composition is by typewriter or by monotype and the quality of the end result is as good as if engravings had been used. We expect to go to offset printing for JAP and JCP early in 1971 and follow with other Institute journals later in the year. If some of the Societies want their monotype-composed journals printed by offset to take advantage of this saving, we expect to be able to accommodate them in the last half of 1971.
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Accounting Costs
Mr. Gilbert distributed a sheet (copy attached to these minutes as Exhibit B) explaining why the costs of the Accounting Section are being budgeted substantially higher in 1971 than they were in 1970. As has been explained previously, both the Institute and the Societies increasingly need more financial information and they need it promptly. The only logical solution has been to computerize our accounting operations. Beginning in January the costs of the Data Processing Section will have to be divided in some way between the Accounting Section and the Fulfillment Division. We have made a guess as to how the costs should be divided in preparing the 1971 budget and must gain experience before we can make a more accurate division. Whether accounting costs will go down in the future will depend on the demand for financial data and reports and on our ability to use the computer for other than accounting and fulfillment operations.
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Compulsory New York State Unemployment Insurance
Mr. Gilbert explained that, heretofore, the Institute has not been required to carry New York State Unemployment Insurance but a change in the law now makes such insurance mandatory for all non-profit organizations beginning January 1, 1971. The tax on the employer is 2.7% of the first $3,000 of salary or $81 per employee per year. This is estimated to cost the Institute $21,900 in 1971 and this amount has been built into the 1971 budget.
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New Employee Benefits Program
The Secretary recalled that the proposed new benefits program had been explained in some detail at the October 5 meeting and had been approved in principle by the Executive Committee at that time with the understanding that remaining details were to be worked out and that the cost of the program would be included in the 1971 budget. Sheets were then distributed (a copy is attached as Exhibit C) giving details of the program as finally worked out. The cost of New York State Unemployment Insurance and the cost of Social Security are included in the program because they are mandatory and because they are really a part of our employee benefits program. The TIAA-CREF retirement plan is the most expensive part of the whole program and is admittedly somewhat generous but it is exactly like the retirement plan which APS has for its employees and, as explained at the October meeting, one of our objectives was to have the AIP benefits program equal to 10% of each employee’s salary. TIAA tells us that the contribution of most employers in their plans in the past has been 8% but many of the new plans are being written for 10%. AIP has improved its retirement plan periodically in the past and the general trend of all organizations is to improve their plans every few years. By adopting the 10% now we may be a few years ahead of the average but we believe it will help us get and hold personnel and we will not have to change it again soon.
Changing from our present retirement plan to the TIAA-CREF plan will involve considerable work on the part of our attorneys because our present plan is approved by the Internal Revenue Service as a “qualified” plan. Our new TIAA-CREF plan would not need to be qualified but we propose to have it so because it may furnish a substantial tax advantage to AIP if we should have an appreciable amount of unrelated business income sometime in the future.
After some discussion of various details of the benefits program, the following motion was made, seconded, and passed without dissent:
MOVED that the new employee benefits program, as presented but excluding the retirement plan, be approved to become effective January 1, 1971.
To provide for the adoption of the TIAA-CREF retirement plan effective January 1, 1971, the following motions were made seconded, and passed without dissent:
MOVED that the agreement dated January 1, 1971, between American Institute of Physics Incorporated and Bankers Trust Company (a copy of which is attached to the official copy of these minutes) for the purpose of amending the Revised Retirement Plan to establish the American Institute of Physics TIAA-CREF Retirement Plan be approved.
MOVED, furthermore, that the American Institute of Physics TIAA-CREF Retirement Plan (copy of which is also attached to the official copy of these minutes) referred to in the agreement heretofore mentioned be approved.
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New Contractual Arrangements with IEE and IPPS
At the July 10 meeting, the Executive Committee approved arrangements with the Institution of Electrical Engineers and the Institute of Physics and the Physical Society, both in London, under which AIP would receive a commission for handling non-member subscriptions to certain of their journals in America. Details of those arrangements for 1971 have now been completed and the anticipated net income of $50,450 from IEE and $9,750 from IPPS has been included in the 1971 budget.
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The meeting was adjourned for luncheon at 12:10 and reconvened at 1:50 p.m.
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Discussion and Adoption of Budget
During the morning’s presentation of the proposed 1971 budget for publishing activities, some skepticism had been expressed about the wisdom of doing away with free reprints for those who honor page charges. It was felt that this might adversely affect page charge honoring and it was pointed out that some educational institutions, particularly state institutions, might not be able to pay page charges if they were billed as a straight contribution whereas they can pay page charges if they are actually buying reprints by such payments. It was also pointed out that the page charge for JCP and JMP could be raised to $65 per page and produce substantially more income. It was also pointed out that we could gain considerably more net income from the journals by reducing the number of unhonored pages published. After further discussion the following two motions were made by Mr. Havens, seconded by Mr. Geballe, and passed without dissent:
MOVED that page charges for JCP and JMP be increased to $65 per page as early in 1971 as possible.
MOVED that the policy of giving 100 free reprints to those honoring page charges be continued and that the budgeted number of honored and unhonored pages for each journal for 1971 be adjusted so that the budgeted over-all net income for the Institute for 1971 will be approximately the same as shown in the proposed budget.
The Director called attention to the fact that the proposed budget showed a net income from operations in 1971 of about $200,000 with the intention on the part of the staff to transfer $150,000 of this to a Publishing Reserve, leaving a net income for the year of a little less than $50,000. The Institute suffered net losses in 1968 and 1969 and the outcome for 1970 is uncertain. Our greatest uncertainties about income and expenses lie in the area of our publications and we very badly need a Publishing Reserve to take care of annual fluctuations. Executive Committee members expressed no disagreement with this point of view and approved the establishment of the Publishing Reserve as proposed if the net income from operations is adequate.
Mr. Havens observed that the amount budgeted for the Public Relations Division for 1971 was somewhat lower than the amount budgeted for that Division in 1970 and he questioned whether this was a proper time to reduce such activities. The importance of physics needs to be promoted to the public now more than at any time in recent past years. The Director responded that the budget for that Division had been reduced because Mr. Kone wanted to reduce his time commitment to AIP but he would still continue with us on a consulting basis. Several Executive Committee members expressed the opinion that the Division should have a full-time director as well as Mr. Kone as a consultant. It was the consensus that a new full-time Director of Public Relations should be sought and the Executive Committee indicated a willingness to revise the budget to provide for such a man if a suitable one can be found.
After some further discussion the following motion was made, seconded, and passed without dissent:
MOVED that the proposed 1971 budget, as presented and modified by the foregoing motions, be adopted.
(The 1971 budget attached to these minutes as Exhibit D includes the modifications authorized by the Executive Committee at this meeting and will be assumed to be the budget adopted when these minutes are approved at the next meeting of the Executive Committee. Summary statements giving further details on the approved budget are also attached as Exhibit E.)
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Future Financial Problems
The Director presented some figures showing the difference between budgeted and actual income or expense for the last ten years and emphasized the difficulty of budgeting accurately particularly in these times of rapid economic change. He repeated the determination of the staff to have a substantial net income from operations at the end of 1971 and said that he would propose further cuts and revisions of the budget at mid-year if it should appear that changes were necessary to reach the financial objective. He recited several possibilities, some quite drastic. No action was requested or taken.
4. Society-Member Programs Review Committee
The Secretary referred to the action taken by the Governing Board on October 7 to establish a committee consisting of representatives from the seven Member Societies for the purpose of reviewing Society-member programs. He said that each of the Societies had appointed a representative and Chairman Sawyer had appointed a chairman of the committee. The committee has arranged to have its first meeting on January 11. The membership of the committee is as follows:
- W. Lewis Hyde (OSA), Chairman
- Peter R. Weiss (APS)
- H. M. Gurin (AAS)
- Robert S. Marvin (SOR)
- Wilbur V. Johnson (AAPT)
- Walter C. Hamilton (ACA)
- Wallace Waterfall (ASA)
In discussing plans for the meeting of this special committee, the Director said he planned to have staff members give brief reviews of current programs in Education and Manpower, Physics History, and Public Relations, and ask the committee to rate the various aspects of these programs with respect to the interests of the Member Societies. He would call the committee’s attention to the costs of the various programs and explain that the continuation or expansion of the program may require special support in some form or other from the Member Societies.
Mr. Havens recalled that, at the Assembly of Society Officers on October 7, the Director had suggested that the dues of $1.00 per member which Member Societies now pay to the Institute might be increased to help pay for some of the Institute’s general activities. As has been pointed out, a change in this dues rate would require a change in AIP By-Laws and this is a rather complicated and time-consuming procedure. Mr. Havens said he had been wondering whether some indirect method of getting funds for the Institute from the Societies might not be preferable, such as putting an overhead charge on the various services which the Institute performs for the Societies. Attention was called to the fact that the existing service contract between the Institute and Member Societies indicates that services are to be performed at cost and placing an overhead charge on services to provide income for general activities would probably require a modification of the contract which might be just as difficult as changing the By-Laws. Nevertheless, Mr. Havens felt that this avenue should be explored and he made the following motion which was seconded and passed without dissent:
MOVED that the AIP staff be requested to explore the possibility of indirect methods of obtaining income from Member Societies to be used in helping to pay for the costs of various general activities.
5. IRS Federal Tax Classification Status
The Tax Reform Act of 1969 divides 501(c)(3) organizations into those that are private foundations and those which are not private foundations. Some time ago the IRS sent inquiries to all 501(c)(3) organizations for the purpose of effecting this division. Mr. Gilbert reported that on November 12 we received official notice from IRS that AIP is not classified as a private foundation. This is the classification we sought and is advantageous to the Institute.
6. Appointments
The Director recommended the following appointments and by motion, made and carried without dissent, they were approved:
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Advisory Committee on PHYSICS TODAY
Term to 12/31/71
- Solomon J. Buchsbaum
- W. W. Havens, Jr.
Term to 12/31/72
- Dale T. Teaney, Chairman
Term to 12/31/73
- John N. Howard
- Thomas H. Curtis
- J. L. Heinselman
- William B. Fretter
- Howard J. Lewis
- Robert D. Turoff
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Advisory Committee on Placement
- Milan Fiske
- Lee Grodzins
- Sherwood Haynes
- Bernard Serin
- Carl York
- Lewis Larmore
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Representative to Scientific Manpower Commission
- A. A. Strassenburg (term to 12/31/71)
- Lewis Slack (term to 12/31/73)
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Magnetics Conference Advisory Committee
Term to 12/31/71
- Julius M. Hastings
- Paul C. Martin
- Philip E. Seiden
- John B. Goodenough
- Howard S. Jarrett
Term to 12/31/72
- Werner P. Wolf
- E. M. Gyorgy
- V. Jaccarino
- Stephan Von Molnar
- A. Brooks Harris
Term to 12/31/73
- Alan J. Heeger
- I. S. Jacobs
- Albert Narath
- Fred B. Hagedorn
- Lester M. Corliss
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Representatives to AAAS Council
- Mary E. Warga (term to 1/15/72)
- Lewis Slack (term to 1/15/73)
The Director said that AIP had been invited to name two representatives on the AAPT Committee on Physics Education. Several suggestions were made by Executive Committee members and it was finally agreed that the choice of representatives should be left to the Chairman and the Director.
7. Request for AIP Sponsorship of Group Travel
The Secretary said that last year the National Center for Educational Travel, Inc., had offered and arranged a number of group flights to Europe for AIP members and they would like to do so again this year. Airline regulations require that AIP officially sponsor the flights but the full cost of publicizing the flights, including direct mail promotion and an ad in PT, would be borne by NCET which would also be responsible for all arrangements. The Secretary said that the AIP staff did not want to be involved in any way and he would make sure that all promotional literature and ads made that point clear. By motion, made and passed without dissent, the Executive Committee agreed to the proposed sponsorship.
8. Next Meeting
The next meeting of the Executive Committee will be a breakfast meeting at the New York Hilton Hotel on Wednesday, February 3, 1971, beginning at 7:30 a.m.
The meeting was adjourned at 3:15 p.m.